In spite of the risk, it's understandable why so many people are anxious to make money currency trading.
For one thing, getting started in Forex trading doesn't require a great deal of money. That alone makes it a very attractive choice. But it's not the only reason.
Instead of having to pick between thousands of stocks (as you would in equities markets), you only need to stay focused on a few currency pairs. The most widely traded and most liquid are EUR/USD, GBP/USD, USD/JPY, USD/CHF, USD/CAD, and AUD/USD.
Another distinct advantage of the Forex market is the fact that it involves such low margins rates. In the equities market, most traders need at least 50% of investment value as margin. Forex traders require as little as 1%. Quite a significant difference, one that allows individual traders a fair shot.
Also, there's directional trading, which means it's possible to profit regardless of whether the market goes up or down. You can go long (buy) a currency pair if you believe it's going to increase in value. Or, if you think the value will decrease, you can go short (sell it).
Of course, the primary benefit of Forex trading is the fact that it's available 24 hours a day. Somewhere in the world, at any given time throughout the week, there's an open market - London, New York, Sydney, Tokyo. No matter what your schedule happens to be, or what hour of day or night is convenient, you'll always have the ability to trade currency.
So how do you make money currency trading?
For the most part, it requires three things. One, that you practice good trading tactics (for example, never over trading, which is something beginners frequently do). Second, and most importantly, that you initiate and then adhere to sound money management rules.
And the third requirement? That you practice trading methods based on technical analysis rather than fundamentals (which involves market reaction to things like interest rates and economic and financial reports). If you want greater odds of success and a less demanding method, then it's imperative that you use a purely technical approach.
Granted, some would have you believe it isn't even possible for the average trader to make money currency trading. That over 90% of those who attempt fail miserably. Fortunately, it doesn't have to be that way.
Yes, it's high risk. As is any form of market investment. But it also has the potential to reap extremely high rewards. Assuming you approach Forex trading correctly and with educated caution.
Dive in head first and you're bound to swiftly and effectively lose whatever funds you have to risk. Take the time to learn the proper methods and you'll always be in a position to make money currency trading.
For one thing, getting started in Forex trading doesn't require a great deal of money. That alone makes it a very attractive choice. But it's not the only reason.
Instead of having to pick between thousands of stocks (as you would in equities markets), you only need to stay focused on a few currency pairs. The most widely traded and most liquid are EUR/USD, GBP/USD, USD/JPY, USD/CHF, USD/CAD, and AUD/USD.
Another distinct advantage of the Forex market is the fact that it involves such low margins rates. In the equities market, most traders need at least 50% of investment value as margin. Forex traders require as little as 1%. Quite a significant difference, one that allows individual traders a fair shot.
Also, there's directional trading, which means it's possible to profit regardless of whether the market goes up or down. You can go long (buy) a currency pair if you believe it's going to increase in value. Or, if you think the value will decrease, you can go short (sell it).
Of course, the primary benefit of Forex trading is the fact that it's available 24 hours a day. Somewhere in the world, at any given time throughout the week, there's an open market - London, New York, Sydney, Tokyo. No matter what your schedule happens to be, or what hour of day or night is convenient, you'll always have the ability to trade currency.
So how do you make money currency trading?
For the most part, it requires three things. One, that you practice good trading tactics (for example, never over trading, which is something beginners frequently do). Second, and most importantly, that you initiate and then adhere to sound money management rules.
And the third requirement? That you practice trading methods based on technical analysis rather than fundamentals (which involves market reaction to things like interest rates and economic and financial reports). If you want greater odds of success and a less demanding method, then it's imperative that you use a purely technical approach.
Granted, some would have you believe it isn't even possible for the average trader to make money currency trading. That over 90% of those who attempt fail miserably. Fortunately, it doesn't have to be that way.
Yes, it's high risk. As is any form of market investment. But it also has the potential to reap extremely high rewards. Assuming you approach Forex trading correctly and with educated caution.
Dive in head first and you're bound to swiftly and effectively lose whatever funds you have to risk. Take the time to learn the proper methods and you'll always be in a position to make money currency trading.
Luis Garcia de Alba Diaz studied economics at Universidad Iberoamericana in Mexico City and has been involved in trading since 1998. Determined to see that beginners succeed and to help discouraged traders gain back their confidence, he developed the Shortcut Forex System at http://www.shortcutforexsystem.com and http://www.howtoinvestforprofit.com.
Article Source: http://EzineArticles.com/?expert=Luis_Garcia_De_Alba_Diaz 
0 comments:
Post a Comment